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EX-31.1 - CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-O - FIRST CASH FINANCIAL SERVICES INCexh31-1.htm
EX-31.2 - CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-O - FIRST CASH FINANCIAL SERVICES INCexh31-2.htm
EX-32.2 - CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350 - FIRST CASH FINANCIAL SERVICES INCexh32-2.htm
EX-32.1 - CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350 - FIRST CASH FINANCIAL SERVICES INCexh32-1.htm
10-Q - FORM 10-Q FOR QUARTER ENDED JUNE 30, 2011 - FIRST CASH FINANCIAL SERVICES INCfcfs2011q2.htm
v2.3.0.11
Note 6 - Discontinued Operations
3 Months Ended
Jun. 30, 2011
Discontinued Operations and Disposal Groups [Abstract]  
Disposal Groups, Including Discontinued Operations, Disclosure [Text Block]



Note 6 - Discontinued Operations     



The Company’s strategy is to increase focus on its pawn operations and further reduce regulatory exposure from other consumer lending products, which include certain consumer loan and credit services products offered in the United States. In March 2011, the Company sold all ten of its consumer loan stores located in Illinois to a privately-held operator of check cashing and consumer lending stores. Under the terms of the agreement, the buyer purchased the outstanding customer loans, customer account lists and fixed assets, assumed leases at all the store locations and hired all of the store-level employees. The final purchase price is contingent on a formula tied to certain levels of customer activity through a post-closing measurement period. The Company recorded an estimated gain of approximately $5,900,000, net of tax, or $0.18 per share, from the sale of these stores in the first quarter of 2011. The estimated gain will be adjusted in the third quarter of 2011 when the final purchase price is determined. The minimum purchase price per the agreement is $12,029,000, which the Company received in March 2011. The balance due of $7,695,000, which is held in an escrow account, is recorded in other current assets as a receivable. The after-tax earnings from operations for the Illinois stores were an additional $514,000, or $0.02 per share for the year-to-date period. Comparable after-tax earnings during the first half of 2010 were $1,332,000 or $0.04 per share.



In September 2010, the Company discontinued its internet-based credit services product offered in Maryland due to a change in state law which significantly restricted the offering of such products. The after-tax earnings from operations for the Maryland credit services operation during the second quarter of 2010 were $252,000, or $0.01 per share, and year-to-date, earnings were $517,000, or $0.02 per share.

All revenue, expenses and income reported in these financial statements have been adjusted to reflect reclassification of all discontinued operations. The carrying amounts of the assets and liabilities for discontinued operations at June 30, 2011, were immaterial. The carrying amounts of the assets for discontinued operations at June 30, 2010, included loans of $3,573,000, which were classified as a component of current assets. In addition, goodwill of approximately $7,800,000 related to the Illinois stores was classified as a component of non-current assets. The carrying amounts of the liabilities for discontinued operations at June 30, 2010, were immaterial.



The following table summarizes the operating results, including gains from dispositions, of all the operations which have been reclassified as discontinued operations in the condensed consolidated statements of operations for the three and six months ended June 30, 2011 and 2010 (unaudited, in thousands, except per share data):



 

 

 

 

 

Three Months Ended

 

Six Months Ended

 

 

 

 

 

June 30,

 

June 30,

 

 

 

 

 

2011

 

2010

 

2011

 

2010

 

 

 

 

 

 

 

 

 

 

 

 

Consumer loan and credit services fees

$

-

 

$

2,663

 

$

1,458

 

$

5,255

Consumer loan and credit services loss provision

 

-

 

 

(426)

 

 

(12)

 

 

(783)

 

Net revenue

 

-

 

 

2,237

 

 

1,446

 

 

4,472

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expenses and other (gain) losses:

 

 

 

 

 

 

 

 

 

 

 

 

Operating and administrative expenses

 

-

 

 

781

 

 

577

 

 

1,670

 

Depreciation and amortization

 

-

 

 

15

 

 

12

 

 

32

 

Estimated gain on sale of assets (Illinois)

 

-

 

 

-

 

 

(9,832)

 

 

-

 

Gain on excess collections of notes receivable

 

(224)

 

 

(919)

 

 

(620)

 

 

(1,818)

 

Gain on sale of real estate

 

-

 

 

-

 

 

-

 

 

(293)

 

 

 

 

 

 

(224)

 

 

(123)

 

 

(9,863)

 

 

(409)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gain before taxes

 

224

 

 

2,360

 

 

11,309

 

 

4,881

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tax expense

 

(90)

 

 

(857)

 

 

(4,524)

 

 

(1,408)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net gain

$

134

 

$

1,503

 

$

6,785

 

$

3,473

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net gain per basic share

$

-

 

$

0.05

 

$

0.21

 

$

0.11

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net gain per diluted share

$

-

 

$

0.05

 

$

0.21

 

$

0.12